Nokia Siemens Networks posts Q4 2012 profit but loss for the full year

Mobile equipment and services provider had a strong last quarter in 2012, but saw revenues decline by 2% for the full year with an operating loss of £673m after restructuring costs are taken into account

Nokia Siemens Networks posts Q4 2012 profit but loss for the full year

Nokia Siemens Networks, part of the Nokia Corporation, posted net sales for Q4 2012 of  Euro 3.9bn (£3.2bn) - up 5% on Q4 2011 and up 14% on the previous quarter in 2012. Net sales for the whole of 2012 were down 2% to Euro 13.7bn (£11.5bn).

NSN attributed the year-on-year decline in overall net sales in 2012 to the decline in sales of business areas that are no longer part of its strategic focus, along with lower infrastructure equipment sales. The latter drop was partially offset by an increase in sales of services.

The company made an operating profit of Euro 251m (£211m) in the fourth quarter of 2012 - up 275% on Q4 2011 and up 38% on Q3 2012. However, heavy restructuring costs over the full year pushed the company into an operating loss of Euro 799m (£673m) compared with a loss of Euro 300m (£252m) in 2011.

NSN believes that its non-IFRS results, which exclude special items such as restructuring costs, provide a more meaningful picture of the company’s underlying performance. When these costs are stripped out, the non-IFRS operating profit for Q4 2012 was Euro 575m (£484m) up 227% on Q4 2011, while the full year showed a profit of Euro 778m (£655m), up 246% on 2011.

In November 2011, NSN announced its strategy to focus on mobile broadband and services, along with the start of a major global restructuring programme. The approximate cumulative cost of that restructure up to Q4 2012 is Euro 1.3bn (£1bn) with Euro 257m (£216m) costs incurred in Q4 2012. At the end of 2012, NSN had 58,400 employees – a reduction of 15,300 compared with the end of 2011.

In terms of sales by geographic area, NSN’s most important regions were Asia-Pacific (particularly Japan) where sales rose by 13% year-on-year to Euro 4.3bn (£3.6bn) and Europe where sales declined (particularly in Western Europe) by 13% to Euro 3.8bn (£3.2bn).

The biggest growth was achieved in North America where net sales rose by 20% year-on-year to Euro 1.2bn (£1bn). Net sales in Latin America fell by 6% to Euro 1.6bn (£1.3bn); in the Middle East and Africa sales fell by 7% to Euro 1.2bn (£1bn); while in Greater China sales declined by 13% to Euro 1.2bn (£1bn).

Written by Wireless magazine
Wireless magazine

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